New Delhi, Sept. 30 -- Software-as-a-service (SaaS) startup Capillary Technologies India Ltd, which counts venture capital firms Peak XV Partners and Avataar Venture Partners as well as growth-stage investor Filter Capital as its investors, has received regulatory approval to float its initial public offering.
The Securities and Exchange Board of India issued its final observations-akin to its approval-on Capillary's IPO proposal last week, according to an update on the capital markets regulator's website.
Bengaluru-based Capillary Technologies had filed its draft red herring prospectus (DRHP) in June this year, after its board approved the company's plan for an IPO worth about Rs 2,250 crore.
According to the DRHP, the startup is looking to raise up to Rs 430 crore through a fresh issue of shares. The IPO also includes an offer for sale of nearly 18.3 million shares by its parent company, Filter Capital, Avataar and some other shareholders.
The startup was last valued around Rs 3,970 crore ($457 million), according to VCCircle estimates based on recent transactions by a few of its investors between December 2024 and March 2025.
Mumbai-based Filter Capital, Schroders Capital Private Equity, the alternative investment arm of British asset management firm Schroders, and existing Indian growth-stage investor Avataar Venture Partners increased their exposure to Capillary Technologies India in a pre-IPO transaction. All three bought shares of Capillary Technologies India from Capillary Technologies International Pte. Ltd (CTIPL), the Indian company's Singapore-based parent firm. CTIPL sold shares worth Rs 141 crore between December 2024 and March 2025.
Based on these transactions, Capillary's IPO valuation will be at least Rs 4,400 crore ($507 million) if it prices the offering at the same level as the pre-IPO transactions. The actual valuation is likely to be higher as pre-IPO transactions generally occur at a discount to the public markets.
Filter Capital intends to sell nearly 0.8 million shares in the IPO. Avataar Ventures will sell 1.8 million shares and its limited partners, which own a stake through a co-investment entity, plan to offload 1.5 million shares.
Capillary, founded in 2012, provides loyalty management and customer engagement technology solutions. Its client roster includes Tata Group, PUMA, Shell, Al-Futtaim, Petron, Domino's, Kanmo Group, and Marks & Spencer. In June 2023, it raised $45 million in Series D after a five-year gap. It later extended the round to $140 million in February 2024. Previously, it had raised capital from Warburg and Peak XV, pocketing $45 million in a Series C round in 2015.
CTIPL, which holds about nearly 65.5% of the Indian entity, is looking to offload nearly 14.2 million shares in the public offering. CTIPL itself counts a number of venture capital firms as its shareholders. These include Filter and Avataar as well as Peak XV Partners, Qualcomm Ventures, and Swiss asset manager Unigestion, which is a limited partner to Avataar.
This is the second time that Capillary Tech has filed for an IPO; it earlier did so in December 2021. At the time, PE firm Warburg Pincus was the single-biggest shareholder of CTIPL. Warburg likely exited some time in 2023, according to a person familiar with the matter. CTIPL had also separately sold some of its stake in the Indian company as part of a Series D round.
Over the last two years, CTIPL has reduced its holding in the Indian entity from 92% to nearly 65.5% to help some of the startup's backers offload their shares directly in India's public market. Unlike some of its startup peers, Capillary did not shift its domicile to India.
Published by HT Digital Content Services with permission from VC Circle.